Adani Group, SEBI Chief, and Industry Leaders Denounce ‘Discredited’ Hindenburg Claims

Adani Group, SEBI Chief, and Industry Leaders Denounce ‘Discredited’ Hindenburg Claims

A recent statement from the Adani Group dismissed Hindenburg Research’s latest allegations as “malicious, mischievous, and manipulative selections of publicly available information.” The latest stock exchange filing of the group termed it as a “recycled and discredited armoury” since they were argued and vehemently rejected by the Supreme Court in January 2024. \

“For a discredited short-seller facing numerous violations of Indian securities laws, Hindenburg’s allegations are nothing but a red herring from an entity that shows callous disregard for Indian laws,” Adani Group said.

SEBI Chairperson’s Response

Chairs of the Securities and Exchange Board of India, Madhabi Puri Buch, together with her husband Dhaval Buch, has hit out hard at the allegations from Hindenburg, calling them an “attempt at character assassination.” This response comes after SEBI had issued an enforcement action and show cause notice to the US-based short seller led by Nate Anderson last month.

“It is unfortunate that Hindenburg Research, against whom SEBI has taken action, has resorted to character assassination in retaliation,” the Buchs said in a joint statement.

Show Cause Notice

Last month, it was announced that Hindenburg and Nate Anderson had infringed on rules related to fraudulent and unfair trade practices, beside the code of conduct for research analysts under SEBI. It is happening at a time when regulators—local and global—are clamping down on short-sellers; recently the US Securities and Exchange Commission has tightened vigil on such investors.

Mutual Funds Body Weighs In

It was said to have condemned the attempts at marring the credibility of Hindenburg at SEBI Chairperson Madhabi Buch. AMFI further warned that such allegations could create unnecessary obstacles for India’s fast-growing economy or undermine it.

“These claims lack context and understanding of the Indian regulatory environment and aim to malign India’s achievements”, stated AMFI.

Investment Clarifications

The investment mentioned in Hindenburg’s report was done back in 2015, much before Madhabi Buch joined SEBI. The Buchs clarified that this investment decision had been premised on their personal connection with some of the fund’s participants, as well as on the credentials of its chief investment officer, by the name of Anil Ahuja.

Statements also confirmed that at no point in time did the fund have any kind of investment in Adani group companies. Additional Reaction Senior advocate Mahesh Jethmalani termed all charges by Hindenburg a “pathetic damp squib” against the stability of India’s stock markets. Other prominent personalities, like former union minister Rajeev Chandrasekhar and ex-Infosys CEO Mohandas Pai, also dismissed the report and termed it a mala fide attempt at funding market instability through a smear campaign against SEBI.

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For one, KV Subramanian, former chief economic advisor and now IMF Executive Director, hailed Madhabi Buch’s integrity and stated that the report has no intellectual rigor and is a poorly carried-out hit job.